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What is the value today of receiving $1,065.00 per year forever? Assume the first payment is...

What is the value today of receiving $1,065.00 per year forever? Assume the first payment is made next year and the discount rate is 11.00%.

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Answer #1

Present value of perpetuity=Annual payments/discount rate

=(1065/0.11)

which is equal to

=$9681.82(Approx).

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